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TPA Joins Over 30 Organizations to Support Occupational Licensing Reform

Michi Iljazi

August 23, 2016

The regulatory burdens that have been holding the economy back are a real problem, for businesses of all sizes. Another component of business that has been harmed by the increasing amount of regulations over the last several years is occupational licensing. Today the amount of jobs that require some form of occupational licensing has grown from five percent to twenty five percent. That kind of growth can be seen all over the country as millions of Americans are beginning to start small businesses, grow existing ones. The problem is the current laws for occupational licensing are costly both in terms of time and money. These laws are harming all Americans, especially women, young adults, and minorities. Right now there is legislation from Senators Mike Lee (R-Utah) and Ben Sasse (R-Neb.) that would reform occupational licensing laws in Washington D.C. and the nation’s military bases. The bill is the Alternatives to Licensing that Lower Obstacles to Work (ALLOW) Act, and just last week Taxpayers Protection Alliance signed this letter with over 30 other groups, sent by Americans for Prosperity urging the Senate support the ALLOW Act. This bill should be the beginning of a new wave of reforms to current, and restrictive occupational licensing laws. The economy works better for all Americans when businesses are allowed to flourish without excessive regulations getting in the way of opportunity and growth.

You can read the full letter below:

August 16, 2016

Dear Senators:

On behalf of our groups and organizations representing millions of Americans from across the political spectrum, we urge you to support legislation sponsored by Senators Mike Lee and Ben Sasse that reforms occupational licensing laws, the Alternatives to Licensing that Lower Obstacles to Work (ALLOW) Act. This bill would increase economic opportunity for people living in the District of Columbia and our nation’s military bases.

One of the most significant barriers to earning a living that people face across the country is strict occupational licensing laws. Over the past 50 years the number of professions requiring licenses has risen dramatically, from approximately one in twenty workers to one in four workers. These laws force people to undergo thousands of hours of training and spend hundreds, if not thousands, of dollars obtaining these licenses to work. These barriers are often too high for people who are beginning their careers or those who are economically disadvantaged.

These licenses place disproportionate impact on women, young people, and minorities, threatening their access to good-paying job opportunities. Young people without a college degree face an unemployment rate twice as high if they do not have an occupational license. Cosmetology licenses in many states prevent African Americans from practicing hair braiding unless they complete hundreds of hours of often unrelated education and incur thousands of dollars of expenses. Additionally, many women returning to workforce often find difficulty obtaining a job without an occupational license.

Support for reforming occupational licensing laws is bipartisan. Even the White House recognizes the damage of excessive occupational licensing. According to a 2015 White House Report, “[T]he current licensing regime in the United States also creates substantial costs, and often the requirements for obtaining a license are not in sync with the skills needed for the job. There is evidence that licensing requirements raise the price of goods and services, restrict employment opportunities, and make it more difficult for workers to take their skills across State

lines.”

The licensing laws in the District of Columbia are especially onerous, and they have contributed to an unemployment rate that is consistently one of the highest in the country. According to the non-partisan Institute for Justice, DC has the 23rd most burdensome licensing laws in the nation. Reforming these laws will improve job opportunities for people living in the District.

Congress should take action to help the residents of the District of Columbia and also provide multiple reform models for the rest of the country. For example, this legislation would also promote reciprocity, by allowing occupational licenses to transfer between military instillations for our brave men and women in uniform and reform and provide a framework for rethinking many unnecessary licenses in DC.

We urge you and your colleagues to support the Alternatives to Licensing that Lower Obstacles to Work (ALLOW) Act sponsored by Senator Lee.